2019-07-07 18:36:00 Sun ET
federal reserve monetary policy treasury dollar employment inflation interest rate exchange rate macrofinance recession systemic risk economic growth central bank fomc greenback forward guidance euro capital global financial cycle credit cycle yield curve
The Chinese central bank has to circumvent offshore imports-driven inflation due to Renminbi currency misalignment. Even though China keeps substantial foreign reserves in U.S. government bonds, traders may still speculate whether the People Bank of China (PBOC) can fix the Dollar-Renminbi exchange rate below 7.0x. This current exchange rate has substantially declined about 9.3% since April 2018 and now hovers in the stable range of 6.89x-6.92x. PBOC Governor Yi Gang indicates that there is no asymmetric red line for the Sino-American exchange rate. However, Chinese economic policymakers may be hesitant to let their currency depreciate past RMB$7-to-USD$1.
Any expectations of short-term currency misalignment can spur capital flight out of the Chinese economy. Chinese public corporations that list abroad have to make cash dividend payments in June each year; so foreign exchange order flows reveal substantive short-term pressure for these Chinese public firms to sell the offshore Renminbi. As China achieves a near-zero current account surplus in mid-2019, the Renminbi faces downward pressure. Renminbi depreciation has long been a major source of tremendous competitive advantage for China. It is important for the Sino-U.S. trade negotiations to level the playing field with respect to potential Renminbi currency misalignment.
If any of our AYA Analytica financial health memos (FHM), blog posts, ebooks, newsletters, and notifications etc, or any other form of online content curation, involves potential copyright concerns, please feel free to contact us at service@ayafintech.network so that we can remove relevant content in response to any such request within a reasonable time frame.
2025-07-26 09:26:00 Saturday ET

Nir Eyal and Ryan Hoover explain why keystone habits lead us to purchase products, goods, and services in our lives. The Hooked Model can help shine new lig
2022-09-25 09:34:00 Sunday ET

Main reasons for share repurchases Temporary market undervaluation often induces corporate incumbents to initiate a share repurchase program to boost the
2019-11-05 07:41:00 Tuesday ET

The Trump administration expects to reach an interim partial trade deal with China. This interim partial trade deal represents the first phase of a comprehe
2019-10-13 16:22:00 Sunday ET

Apple unveils 3 iPhone 11 models with new original video services and stars such as Oprah Winfrey, Jennifer Aniston, and Reese Witherspoon. Apple releases t
2018-01-04 07:36:00 Thursday ET

The world now faces an economic inequality crisis with few policy options. Some recent U.S. Federal Reserve data suggest that both income and wealth inequal
2020-06-10 10:35:00 Wednesday ET

Most lean enterprises should facilitate the dual transformation of both core assets with fresh cash flows and new growth options. Scott Anthony, Clark Gi